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"We made some changes internally and created a focused hydrogen organisation, a focused offshore wind organisation," Dotzenrath said in an interview. "I'm (now) just reviewing the onshore renewables part - so the onshore wind and solar part."

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China says U.S. should change attitude or risk conflict

"The United States' perception and views of China are seriously distorted," said Qin, a trusted aide to President Xi Jinping and until recently China's ambassador in Washington.

Reuters by Ryan Woo

Inside BP's plan to reset renewables as oil and gas boom

The oil major isn't backing away from renewables though, its green chief Anja-Isabel Dotzenrath stresses, it's simply changing the terms of the relationship.

Reuters by Ron Bousso

EU hopes Macron will budge on Latin American trade deal

‘We all expect a shift in Paris but this has not been tested politically yet,’ says one EU diplomat.

BY GIORGIO LEALI, CAMILLE GIJS AND SARAH ANNE AARUP, MARCH 6, 2023 

EU hopes Macron will budge on Latin American trade deal

‘We all expect a shift in Paris but this has not been tested politically yet,’ says one EU diplomat.

BY GIORGIO LEALI, CAMILLE GIJS AND SARAH ANNE AARUP, MARCH 6, 2023 

CERAWEEK Eni CEO says gas market will be "difficult" for Europe through 2025

"This next year, and also in 2024 and 2025, will be more difficult because last year until July we relied on about 80% of the Russian gas," he told the CERAWeek conference in Houston.

Reuters

China says U.S. should change attitude or risk conflict

"The United States' perception and views of China are seriously distorted," said Qin, a trusted aide to President Xi Jinping and until recently China's ambassador in Washington.

Reuters by Ryan Woo

US must stop suppressing China or risk 'conflict' - FM

BEIJING, March 7 (Reuters) - The United States should change its "distorted" attitude towards China or "conflict and confrontation" will follow, China's foreign minister said on Tuesday, while defending its stance on the war in Ukraine and defending its close ties with Russia.

The U.S. had been engaging in suppression and containment of China rather than engaging in fair, rule-based competition, Foreign Minister Qin Gang told a news conference on the sidelines of an annual parliament meeting in Beijing.

"The United States' perception and views of China are seriously distorted," said Qin, a trusted aide to President Xi Jinping and until recently China's ambassador in Washington.

"It regards China as its primary rival and the most consequential geopolitical challenge. This is like the first button in the shirt being put wrong."

Relations between the two superpowers have been tense for years over a number of issues including Taiwan, trade and more recently the war in Ukraine but they worsened last month after the United States shot down a balloon off the U.S. East Coast that it says was a Chinese spying craft.

The U.S. says it is establishing guardrails for relations and is not seeking conflict but Qin said what that meant in practice was that China was not supposed to respond with words or action when slandered or attacked.

"That is just impossible," Qin told his first news conference since becoming foreign minister in late December.

Qin's comments struck the same the tough tone of his predecessor, Wang Yi, now China's most senior diplomat after being made director of the Foreign Affairs Commission Office at the turn of the year.

"If the United States does not hit the brakes, and continues to speed down the wrong path, no amount of guardrails can prevent derailment, which will become conflict and confrontation, and who will bear the catastrophic consequences?"

U.S. officials often speak of establishing guardrails in the bilateral relationship to prevent tensions from escalating into crises.

Qin likened Sino-U.S. competition to a race between two Olympic athletes.

"If one side, instead of focusing on giving one's best, always tries to trip the other up, even to the extent that they must enter the Paralympics, then this is not fair competition," he said.

'JACKALS AND WOLVES'

During a nearly two-hour news conference in which he answered questions submitted in advance, Qin made a robust defence of "wolf warrior diplomacy", an assertive and often abrasive stance adopted by China's diplomats since 2020.

"When jackals and wolves are blocking the way, and hungry wolves are attacking us, Chinese diplomats must then dance with the wolves and protect and defend our home and country," he said.

Qin also said that an "invisible hand" was pushing for the escalation of the war in Ukraine "to serve certain geopolitical agendas", without specifying who he was referring to.

He reiterated China's call for dialogue to end the war.

China struck a "no limits" partnership with Russia last year, weeks before its invasion of Ukraine, and China has blamed NATO expansion for triggering the war, echoing Russia's complaint.

China has declined to condemn the invasion and has fiercely defended its stance on Ukraine, despite Western criticism of its failure to single Russia out as the aggressor.

China has also vehemently denied U.S. accusations that it has been considering supplying Russia with weapons.

ADVANCING RELATIONS WITH MOSCOW

Qin said China had to advance its relations with Russia as the world becomes more turbulent and close interactions between President Xi Jinping and his Russian counterpart, Vladimir Putin, anchored the neighbours' relations.

He did not give a definite answer when asked if Xi would visit Russia after China's parliament session, which goes on for one more week.

Since Russia invaded its southwestern neighbour a year ago Xi has held talks several times with Putin, but not with his Ukrainian counterpart. This undermines China's claim of neutrality in the conflict, Kyiv's top diplomat in Beijing said last month.

Asked whether it was possible that China and Russia would abandon the U.S. dollar and euro for bilateral trade, Qin said countries should use whatever currency was efficient, safe and credible.

China has been looking to internationalise its currency, the yuan, which gained popularity in Russia last year after Western sanctions shut Russia's banks and many of its companies out of the dollar and euro payment systems.

"Currencies should not be the trump card for unilateral sanctions, still less a disguise for bullying or coercion," Qin said.

*Reporting by Yew Lun Tian, Laurie Chen, Ryan Woo and the Beijing Newsroom; Writing by Martin Quin Pollard; Editing by Lincoln Feast and Tom Hogue

Inside BP's plan to reset renewables as oil and gas boom

The oil major isn't backing away from renewables though, its green chief Anja-Isabel Dotzenrath stresses, it's simply changing the terms of the relationship.

Reuters by Ron Bousso

LONDON, March 7 (Reuters) - BP hasn't fallen out of love with renewables. It just wants to have more power.

CEO Bernard Looney's pursuit of green energy outstripped all rivals three years ago when he outlined a radical blueprint to move away from fossil fuels. Last month he applied the brakes, slowing BP's planned cuts in oil and gas and scaling back planned renewables spending in the wake of the war in Ukraine.

The oil major isn't backing away from renewables though, its green chief Anja-Isabel Dotzenrath stresses, it's simply changing the terms of the relationship.

Dotzenrath told Reuters BP was reviewing its solar and onshore wind businesses as part of a revamp that will see it move away from selling the clean electricity it produces, and instead keep hold of most of it to supply its growing electric vehicle charging network and production of low-carbon fuels.

The onshore renewables scrutiny, which hasn't been previously reported, follows reviews by Dotzenrath of BP's offshore wind and hydrogen businesses over the past year which led to overhauls that saw the company install new managers, hire staff, scrap some projects and seek to revise terms of others.

"We made some changes internally and created a focused hydrogen organisation, a focused offshore wind organisation," Dotzenrath said in an interview. "I'm (now) just reviewing the onshore renewables part - so the onshore wind and solar part."

BP's head of renewables and gas didn't elaborate on the nature of the latest review. The green stakes are high, though, given solar alone comprises more than half of BP's 43-gigawatt renewables project pipeline.

Dotzenrath also put the first numbers to BP's rebalancing act, which comes amid deteriorating profits in renewables power generation, telling Reuters that the company aimed to retain 80% of the power produced to supply the global EV network and to make "green" fuels such as hydrogen, seen by many transition experts as a key fuel of the future.

She did not give a timeframe for the shift, which represents a major pivot given the vast majority of BP's renewables output is currently linked to power grids. BP will continue to build some projects under traditional power supply deals, she added.

"We will not grow renewables for the sake of growing wind and solar," said Dotzenrath, who is marking a year in the job after joining BP shortly after Russia's invasion undermined Europe's energy security, fuelled bumper profits for oil and gas and changed the calculus of the energy transition.

"Our strategy is not necessarily about asset ownership in renewables, but it comes as a consequence. It is really about securing access to cheap - the cheapest - green electron," she added, referring to electricity from renewable sources.

IN FOCUS: VENTURE WITH EQUINOR

The most eye-popping change in the strategy update last month was BP slowing its planned cuts in oil and gas output from 40% to 25% by 2030 compared with 2019 levels.

It also lowered its projected annual spending on renewables to up to $5 billion by 2030 out of a total group budget of up to $18 billion, from $6 billion out of $16 billion under its previous update in 2022, according to a Reuters analysis.

While BP's move to produce more oil and gas for longer puts it more in line with its peers, its 25% annual reduction goal is still more ambitious than any of its global rivals.

The paring of green ambitions has been cheered by the market, with BP shares leaping about 17% since the Feb. 7 strategy update, much more than any other rival Western major.

By contrast, BP had significantly underperformed rivals since Looney outlined his industry-leading transition plans three years ago, remaining largely flat until the announcement compared with a 20% gain for Shell and 84% rise for Exxon.

The renewables revamp reflects an acknowledgement that the company won't be able to sufficiently compete with traditional power generators if it simply sells the energy produced by its wind and solar projects, according to Dotzenrath.

"It's a critical feedstock," she said. "If it is not integrated with our other businesses, we will not do this because we don't believe that we have a competitive edge."

The company's new trajectory has placed its flagship U.S. offshore wind joint venture with Norway's Equinor in the focus of managers, five sources familiar with the matter separately told Reuters.

BP executives, including Dotzenrath, have held several meetings with Equinor in London in recent weeks to discuss ways to give the oil major greater clout in the venture, said the two BP and three Equinor sources, who are close to the talks and declined to be named due to the sensitivity of the matter.

BP wants more of its staff involved in the Oslo-based venture, the people said. One of the Equinor sources with direct knowledge of the operations said BP currently had more than 20 people working on the JV projects out of a total of over 270.

Equinor declined to comment on any "speculation" about changes to the venture sought by BP. It said it looked forward to applying their combined expertise to develop projects on the U.S. East Coast. Dotzenrath also declined to comment on this.

"I am very happy with the joint venture and the progress we are making with the projects," Dotzenrath said. "These are very, very complex, large, mega projects ... we have much more ability to support Equinor in the delivery of these projects."

THAT'S THE BRUTAL REALITY

When BP paid $1.1 billion for its 50% stake in the venture to enter offshore wind in 2020, it was more reliant on the know-how of Equinor, which had over a decade of experience and specialism in the sector.

Over the past two years, though, BP has brought in hundreds of staff from renewables firms. It has also broken from its tradition of developing leaders internally and hired senior executives such as Dotzenrath, a former CEO of Germany's RWE Renewables, and an offshore wind chief from Danish giant Orsted.

The UK major surprised many investors and analysts in December when it decided not to join Equinor in bidding on a floating wind project off California. Floating offshore wind is a nascent technology that remains significantly more expensive than turbines fixed to the seabed.

"This was a portfolio decision," Dotzenrath said. "The North Sea is much more important to us and our integration story than California. I think that's the brutal reality at the moment."

THE NEW NORMAL IN NUMBERS

BP's renewables revamp is underpinned by its projections about how much money it can make from the production and sale of green power versus higher-margin low-carbon businesses within its own integrated operations.

The company's outlook for its average core earnings from oil and gas in 2030 grew by around $10 billion to $42.5 billion over the course of last year, and by a meagre $1.5 billion to $11 billion from energy-transition businesses including renewables.

BP expects a return on investment of at least 15% on bioenergy including biogas as well as from combining EV charging with retail stores. Hydrogen is seen bringing in 10% returns, with renewables lagging at a maximum of 8% under the current model dominated by power sales.

While BP had a stated target in 2020 of trading 500 terawatt hours of electricity by 2030 – twice the volume in 2019 - no such target featured in its 2023 strategy update.

Dotzenrath said growth in renewables capacity would be in service to green hydrogen and other businesses it supplied internally with clean power.

"We take the green electron and do something with it," she added. "Access and control over the green electron is key because the world is short of green electrons."

*Reporting by Ron Bousso, Shadia Nasralla; Editing by Pravin Char

EU hopes Macron will budge on Latin American trade deal

‘We all expect a shift in Paris but this has not been tested politically yet,’ says one EU diplomat.

BY GIORGIO LEALI, CAMILLE GIJS AND SARAH ANNE AARUP, MARCH 6, 2023 

PARIS — The planets now seem aligned to finally push a trade deal between the EU and Latin American countries over the finish line. Well, all planets but one — Jupiter, France’s nickname for Emmanuel Macron.

EU negotiators are traveling to Buenos Aires this week for a final stretch of trade talks with the Latin American Mercosur countries. But the main opponent of the deal is less than a 90-minute rail trip away from Brussels, in Paris. The French government says it wants to wait and see before signing off on the deal. But currently it’s mostly waiting. 

The discussions could get tricky, as Brussels will only sign on the dotted line if Brazil, Argentina, Uruguay and Paraguay agree to extra climate commitments that it has now put to the Mercosur countries in writing for the first time.

Publicly, there are few signs that France will budge. “I have held a firm position and I will continue to hold it,” Macron told farmers in late February.

In Brussels, though, several EU diplomats said that Paris’ opposition to the deal has become less vocal. They see this as a sign that France could change its mind as geopolitical tensions following the war in Ukraine and the coronavirus pandemic strengthen the case for the 27-nation bloc to diversify its trading relationships.

“We all expect a shift in Paris but this has not been tested politically yet,” said an EU diplomat, predicting that “this year will be the real test” for France after the election last year of Luiz Inácio “Lula” da Silva installed a leader in Brazil with whom Europe can do business.

The political context in Paris has changed, too, since Macron won reelection last year for a second and final term as president, another EU diplomat said, meaning he faces less pressure to please France’s globalization-skeptic voters.

Paris wants the Mercosur bloc to commit to stop illegal deforestation in the Amazon, to comply with the Paris climate agreement, and to apply the same environmental and sanitary standards as EU farmers. “We are still far from that,” a French official said.

It's a message that Macron drove home last week, albeit indirectly, on a trip to Africa where — posing before a scenic backdrop of rainforest in Gabon, on Central Africa's Atlantic coast — he emphasized the importance of primary tropical rainforests in soaking up carbon emissions.

One more thing ...

The European Commission has to assuage the concerns of France, the European Parliament and NGOs, and it has been working on a legally-binding addendum on how to include extra environmental criteria from the Mercosur countries without having to reopen the original trade deal and make changes to it.

The secret document has yet to be published, and the French government hasn’t yet taken a position on it. But the same French official conceded that France’s worries could be addressed without reopening the deal itself — a sign that the additional protocol could be enough to persuade Paris to change its mind.

Supporters of the deal stress that much has changed since it was first struck in 2019, including the fact that the EU now has new rules banning the import of goods whose production entails deforestation. Also, last year, the EU implemented a new carbon border tax that would hit polluting competitors around the world.

Farmer Julien Georges at the Salon de l’Agriculture | Giorgio Leali for POLITICO

Former EU trade commissioner and WTO chief Pascal Lamy said the Commission should be brave and defy Paris in a vote amongst EU capitals. 

“At the end of the day, the Commission should ask the Council for a vote, saying that we have spent a lot of time trying to get everyone to agree and that there is not a blocking minority of member states. I had to do it myself when I was commissioner," said Lamy, noting that the trade section of the deal doesn’t need the unanimous support of EU capitals to pass.  

Opposition to the Mercosur deal is almost unanimous in France, with all political groups and the country’s powerful farm lobby FNSEA constantly describing it as a threat to farmers and consumers. 

Backing the deal could mean losing the support of French farmers, who could then swing towards Marine Le Pen’s far-right National Rally, Macron’s arch-nemesis.

“Many small farmers switched to the National Rally, it’s the pressure of the National Rally,” as Lamy put it. 

Healthy diet

When Macron in late February visited the Salon de l’Agriculture, a major farming event on the outskirts of Paris, he spent most of his day with livestock breeders and had lunch with meat industry representatives worried that the Mercosur deal would open the floodgates to imports of South American beef. 

“Feeding the French people with merde (shit) so that we can export other products to South America is inadmissible,” farmer Julien Georges, who owns a herd of 140 Charolais cattle in the Lorraine region, told POLITICO as Macron stood nearby.

But not everyone is against the deal in France. Business organizations in France and Europe in the past repeatedly urged Brussels and Paris to unlock the deal. 

“We are unable to defend the agreement. Even if we are in favor of it, politically it does not pass,” said a French industry representative, who refused to speak publicly, stressing the political sensitivity of the deal in France.

The French government is gearing up to face additional pressure as Brussels is moving faster to push the deal beyond the finish line. Officials from the economy and trade ministries are testing the waters, for instance by setting up meetings with industry representatives. 

“We know very well that some want to make progress on [the deal], we will see what balances can evolve,” said one official from the French prime minister's office, requesting anonymity due to the sensitivity of the matter. 

For Lamy, the former trade commissioner, the time has come for Paris to finally be pragmatic and back a deal where Europe has more to gain than to lose.

“If you think that you can open that market without having to pay something when it comes to agriculture … you must be dreaming!”

Giorgio Leali reported from Paris, and Camille Gijs and Sarah Anne Aarup from Brussels. Additional reporting by Barbara Moens.

*This story corrects the attribution of a quote to farmer Julien Georges.

Cooperate with objective and ethical thinking…

CERAWEEK Eni CEO says gas market will be "difficult" for Europe through 2025

Reuters

Eni Chief Executive Officer Claudio Descalzi attends a signing ceremony as QatarEnergy joins TotalEnergies and Eni to explore Lebanon's offshore oil and gas, in Beirut, Lebanon January 29, 2023. REUTERS/Mohamed Azakir/File Photo

HOUSTON, March 7 (Reuters) - Eni (ENI.MI) CEO Claudio Descalzi said on Tuesday that the natural gas market will be "more difficult" for Europe this winter through 2025 due to a lack of supply from Russia.

"This next year, and also in 2024 and 2025, will be more difficult because last year until July we relied on about 80% of the Russian gas," he told the CERAWeek conference in Houston.

"Now there's no Russian gas at all."

*Writing by Richard Valdmanis